Friday, August 22nd, 2014 at 5:09pm. 16 Views, 0 Comments.
COMMENTARY: Much of last Friday's buying pressure of mortgage-backed securities reversed course this week as high level cease-fire talks between Russia and Ukraine begin and the situation in Iraq appears to be improving. In addition, this week and next are the more heavily-vacationed weeks of the year for investors in both the credit and equity markets. With a number of market participants spending the next ten work days sipping Mai Tai's and applying sunscreen instead of trading, it is almost certain price volatility will probably be higher than usual due to the limited trading action. Trading activity won't really return to "normal" until a day or so after the Labor Day Holiday break.
The coming week will feature the release of the July New Home…
Monday, August 11th, 2014 at 9:39pm. 43 Views, 0 Comments.
>> Market Update
QUOTE OF THE WEEK... "Normalcy is not interesting." --Lindsay Lohan, American actress, model, producer, and recording artist
INFO THAT HITS US WHERE WE LIVE... If the troubled performer were earning her living in real estate, she might think differently about normalcy. For a few years now, the housing market has been anything but normal, so any return to stability is interesting indeed. With a major real estate information provider reporting home price gains moderating in June, their chief economist observed, "This reversion to normality that we are finally experiencing is expected to continue across the country and should further alleviate concern over diminishing affordability and the risk of another asset bubble."
Saturday, August 9th, 2014 at 3:00pm. 73 Views, 0 Comments.
COMMENTARY: News of the week produced little effect on mortgage rates until Europe intervened once again. Potential U.S. airstrikes in Iraq, resumed military conflicts in Gaza between Palestinian militants and Israel and NATO calling for Russia "to step back from the brink" of war in Ukraine has created a round of "flight-to-quality" buying of U.S. Treasury and agency eligible mortgage-backed securities as current global uncertainty reduces the attractiveness of riskier asset classes.
These news events are temporarily supporting the prospects for steady to perhaps fractionally lower mortgage interest rate ahead. Notice the key word "temporarily." At the first sign the current headline grabbing conflicts may be de-escalating -- a…
Monday, August 4th, 2014 at 9:52pm. 61 Views, 0 Comments.
>> Market UpdateQUOTE OF THE WEEK... "The trees that are slow to grow bear the best fruit."--Moliere, French playwright and actor
INFO THAT HITS US WHERE WE LIVE... If the great French dramatist were alive today, he probably wouldn't be concerned by signs of slower growth in the housing market. Perhaps we shouldn't be either. Pending Home Sales dipped a miniscule 1.1% in June, but climbed for three straight months before that. This National Association of Realtors (NAR) index of contracts signed on existing homes was also above the 100 "average" level of contract activity for the second month in a row. The NAR's chief economist said he expects existing home sales to edge up in the second half of the year.
That economist also observed, "The good news is…
Friday, August 1st, 2014 at 4:44pm. 62 Views, 0 Comments.
COMMENTARY: On a weekly basis during football season, you’ll invariably hear a Coach say after an upset that this is why they play the games. Same can be said for predicting the future of mortgage rates. Last week we cautioned that this week’s economic GDP and Jobs report had the potential to significantly increase mortgage rates. Wednesday’s GDP report did not disappoint showing a 4.0% annualized pace during the second-quarter, the strongest improvement in this index since Q3 of 2013, and well ahead of the consensus estimate of economists calling for a gain of 3.0%. Mortgage investors were more than a little surprised which sent all of them scrambling to nudge mortgage interest rates fractionally higher.
So what happened today with the Jobs report…
Tuesday, July 29th, 2014 at 11:23am. 102 Views, 0 Comments.
>> Market Update
QUOTE OF THE WEEK... "I've had a lot of worries in my life, most of which never happened."--Mark Twain, American author and humorist
Friday, July 25th, 2014 at 2:58pm. 106 Views, 0 Comments.
COMMENTARY: This week’s slightly increasing rates were squarely affected by thoughts of next week’s all important Job’s report on Friday. On Tuesday, NAR reported that existing home sales in June were at the highest levels in 8 months. With many of the fundamental drivers of housing either improving or holding steady, the outlook for the rest of the year and into 2015 looks decent. Job growth will be the key, and the prospects for further improvement in the labor sector have improved notably over the past three months. As part of this scenario however is the unfortunate truth that mortgage rates tend to increase as the economy does better. Kind of a pick-your-poison type of choice I guess. Further proof of positive economic strides were shown…
Tuesday, July 22nd, 2014 at 7:11am. 86 Views, 0 Comments.
>> Market UpdateQUOTE OF THE WEEK... "How wonderful that we have met with a paradox. Now we have some hope of making progress."--Niels Bohr, Danish physicist
INFO THAT HITS US WHERE WE LIVE... The dictionary defines "paradox" as a seemingly self-contradictory statement that when investigated may prove to be true. Last week's housing news indeed presented a paradox. Housing Starts took a hefty 9.3% drop in June while the National Association of Home Builders (NAHB) reported member confidence at a 6-month high! In fact, the NAHB builder index rose to a reading of 53, reflecting good sales conditions and a positive outlook going forward. The NAHB Chairman offered, "This is the first time that builder confidence has been above 50 since January and an…
Saturday, July 19th, 2014 at 7:15am. 151 Views, 0 Comments.
COMMENTARY: Rates were following the normal slow-changing summer pattern this week when the wonton disregard for human life came into focus in Europe. Mortgage prices got a boost higher (rates lowered) yesterday from a flow of “flight-to-quality” buying favoring dollar-denominated assets – particularly Treasury debt obligations and agency eligible mortgage-backed securities. The buying was driven by knee-jerk reactions related to the downing of the Malaysian airline over the Ukraine and the escalation in the Israeli-Palestinian conflict. Investors have largely moved to the sidelines today to await further developments related to these two stories. It’s a helluva way for mortgage rates to decrease but it is what it is.
Looking ahead to the coming…
Saturday, July 12th, 2014 at 7:38am. 214 Views, 0 Comments.
COMMENTARY: As is wont to happen during the dog days of summer, this week was pretty blasé from a mortgage rate standpoint. Wednesday’s release of notes from the recent Federal Reserve meeting revealed nothing that everyone didn’t already know and Thursday’s Labor Department unemployment report showed a 11,000 reduction in new claims filed. Jobless claims have now fallen to their lowest level since just before the 2007-09 recession, a sign of much improved demand in the labor sector. With such uninteresting news, mortgage interest rates were most influenced by trading activity in the stock markets during the entire week. Higher stock prices tend to drag mortgage interest rates fractionally higher while lower stock prices will probably prove supportive…